Debate over Keystone oilsands pipeline heats up south of the border

CALGARY – Dozens of groups are urging regulators to further extend an environmental review of a proposed Alberta-to-Texas oil pipeline on the heels of a New York Times editorial slamming the controversial project.

The weekend editorial said the U.S. State Department must say no to TransCanada Corp.’s US$13-billion Keystone XL project, which it said poses “enormous” environmental risks to both Canada and the United States.

On the Canadian side, the newspaper said the oilsands mining process destroys boreal forest, emits more carbon dioxide and threatens water sources.

And south of the border, it said the potential for pipeline leaks pose the greatest threat to land and water along the pipeline’s route.

“From all the evidence, Keystone XL is not only environmentally risky, it is unnecessary,” the editorial said.

Andrew Leach, a business professor at the University of Alberta, said the Times editorial shows efforts by the industry and government to get the American public on-side with Canadian oil imports aren’t working.

“My take is we’d be better to put in place the world class monitoring regime that we keep talking about, and enforce the regulations that we have,” he said Monday.

“Let’s set the rules that don’t enable people to use environmental performance to block our expansion to markets, to impose costs on us, to pull away the value of that resource.”

Travis Davies, with the Canadian Association of Petroleum Producers, said there’s a disconnect between the Times’ stance and how the public views the pipeline. He said polling done by CAPP shows most Canadians and Americans are in favour of it, provided it’s undertaken in an environmentally responsible manner.

He added the editorial also doesn’t jibe with signals from the Obama administration, which last week singled out Canada as a key source of oil to the United States as it seeks to cut imports from the Middle East.

“All of the signals we’re hearing from the regulator, the administration is that the project is being viewed as a positive step for the U.S.,” Davies said.

On Monday, a group of more than 30 local and national organizations sent a letter to U.S. Secretary of State Hillary Clinton urging her to extend the comment period for a supplemental environmental impact statement on Keystone XL from 45 to 120 days.

The State Department said in March it would undertake the extra review, pushing approval for the project back by several months. If the department grants the groups’ request, it would likely mean further delays.

Meanwhile, an alliance of 24 U.S. mayors wrote a letter to Clinton urging her to approve the pipeline.

“We firmly believe that the Keystone Pipeline will not only contribute to our national security by lessening our dependence on oil from unreliable foreign sources, but will also lead to job creation and growth,” the letter said.

The State Department has the final say on Keystone XL, since it crosses the Canada-U.S. border.

Keystone XL would link up with an existing pipeline system that delivers crude to Illinois, Nebraska and Oklahoma. The expansion would raise the line’s capacity by 500,000 barrels of crude per day, and extend its reach to the lucrative Gulf Coast.